The House is expected to approve Thursday a bill that would increase the number of hours an employee has to work before the employer must offer health insurance under the Affordable Care Act.
The White House has threatened to veto the bill, saying it would increase the deficit and the number of uninsured, while giving employers a greater incentive than they have now to reduce workers’ hours to avoid paying for health insurance.
“What’s clear is that the temptation that some employers might have would only be sweetened significantly if this Republican change were to be put into place,” said White House spokesman Josh Earnest.
Indiana GOP Rep. Todd Young, the lead sponsor of the bill the House will vote on, and Indiana Sen. Joe Donnelly, the top Democratic sponsor of the Senate’s version, say their proposals would restore the traditional definition of a full-time job to 40 hours a week instead of the 30-hour threshold included in the Affordable Care Act. Employers with at least 50 full-time workers must offer health care or face potential penalties under the law.
“I know in South Bend, Indiana, and in Terre Haute, Indiana, if you took a microphone out and asked people ‘What’s a full-time work week?’ you’d get 172 saying ’40’ and you’d get zero saying ’30,’ ” Donnelly said.
Before the ACA, employers already had varying policies on how many hours an employer must work to get health benefits. At Ivy Tech in Indiana, for example, employees who are not adjuncts can get coverage if they work 32 hours a week. State employees get coverage at 37.5 hours a week. Purdue University doesn’t offer benefits to adjuncts and student workers; but for those in a “benefits eligible position,” full time is defined as working at least 20 hours a week.
Ivy Tech President Tom Snyder said that because of the ACA, the Indiana community college system has reduced the classroom hours of adjunct professors to keep them under the 30-hour limit so they don’t qualify for health insurance. That makes it more difficult to keep tuition affordable, he said.
“The 30-hour rule clearly has unintended consequences,” Snyder said at a Capitol Hill news conference. “The elimination of this rule will benefit all Americans.”
The mandate begins this year for some firms with 100 or more full-time workers and starts in 2016 for firms with 50 or more employees.
Young said the workers whose hours are being cut are those that can least afford a pay cut.
“We’re talking about cafeteria workers around the country,” he said. “We’re talking about substitute teachers at our public school corporations. We’re talking about employees at our youngest firms that are still fledgling and trying to stay alive.”
But the White House says more workers would be in jeopardy of having their hours cut under Young’s bill because there are more people who work around 40 hours a week than 30 hours a week.
The Commonwealth Fund, a private health care foundation that examined workers in firms that don’t already provide health insurance, concluded there are more than twice as many workers at risk of having their hours reduced to avoid the law if the definition of full-time is changed to 40 hours.
The nonpartisan Congressional Budget Office estimates the change would reduce by about 1 million the number of Americans who get health coverage through their job. Some of them would remain uninsured while others would end up on government health care programs.
The cost to the federal government would go up — by an estimated $53 billion over 10 years — while costs to businesses would go down as there would be fewer penalties assessed for not providing health insurance, according to the CBO.
Young said that because the bill would reduce penalties for employers, that amounts to a tax cut and he generally does not believe bills that cut taxes need to be offset to avoid increasing the deficit.
Donnelly said the cost he’s concerned about is the smaller paycheck someone is getting if their hours are reduced from 38 to 28 a week because of the law’s definition.
“That’s a cost that has to be brought into this as well,” he said.
The Senate is planning a hearing on its version of the bill later this month.